Predict effect of law on the competitive equilibrium rent

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Question: The cities of Peabody and Woburn are five miles apart. Woburn enacts a rent control law that puts a ceiling on rents well below their competitive market value. Predict the effect of this law on the competitive equilibrium rent in Peabody, which does not have a rent control law. Illustrate your answer with a demand and supply graph.

Reference no: EM132122056

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